Lock, Stock & Barrel: Don't wait to buy, but buy to wait

(File pix) The forward thinking investor will be able to see this and will hedge his bets by investing in locations that are further away. Then it will just be a matter of waiting for the demand to grow in those locations and watching your investment appreciate.

A FRIEND asked me this question today: What is your take on housing appreciation in second-tier locations like Semenyih, Kemuning or Rawang?

My take is simple: Don’t be too concerned about these locations. Go ahead and buy. These locations are already popular, and with time, they will become even more sought after, and properties in these locations will continue to appreciate.

Would you believe that once upon a time, Bangsar was considered a location far away from Kuala Lumpur town? That was when Kuala Lumpur wasn’t even a city yet.

It must have been a big mindset shift for properties in Bangsar to get sold. And when Petaling Jaya was being developed, I wonder how many people said there was no way anyone would want to live that far away.

Today, these two locations are unbelievably close to the city. No one would ever describe Bangsar and Petaling Jaya as being too far from the city.

As property prices continue to escalate, we have very little choice but to live further and further away from the city centre. Kuala Lumpur city and its close environs have become simply too expensive for everyone except the well-heeled, super rich minority. The large middle-class can scant afford to buy properties in the city and its close suburbs.

Many years ago, the first real exodus away from these preferred locations started. Cheras, Kepong and locations of such nature became popular, as properties in these locations remained cheaper and more affordable. As the city grew and its population increased, people had to move further and further away.

Today, locations like Semenyih and Rawang, which only a few years ago were deemed simply too far, have become much sought after. Prices of properties in these locations are no longer cheap. What this essentially will mean is that in time, we will need to get used to buying properties and living even further away.

Today, living 40km or 50km away from the city is considered the norm for many. In time, people will get used to living even further away. Travelling distances of 80km to 100km will one day become the acceptable norm.

The forward thinking investor will be able to see this and will hedge his bets by investing in locations that are further away. Then it will just be a matter of waiting for the demand to grow in those locations and watching your investment appreciate.

There is every chance that Kepong and Cheras will become the Bangsar and Petaling Jaya of tomorrow. And then it’s only natural to assume that Rawang and Semenyih will become the Kepong and Cheras of tomorrow.

We have so much land. We don’t need to build so many high-rise developments. The Klang Valley and Selangor have enough space to accommodate many more landed property developments. However, the biggest bane to this is the inefficient public transportation system that we have today.

What is needed is a solution that can move people hundreds of kilometres in a fast, efficient and cheap manner. Long-haul trains are the only solution. You only need to visit other cities in first-world countries to know that what I’m saying is true. And it can be done.

This old saying comes to mind: “Don’t wait to buy real estate. Buy real estate and wait”. Never have truer words been said, especially in today’s Malaysian real estate market.